What Should Franchisors Consider During Franchisee Selection?

A young franchise organization may be more relaxed in their evaluation of franchise candidates as their foremost objective will likely be to grow their franchisee base. On the other hand, an established franchise organization, normally in a relatively better position to choose franchisees, may adopt a more stringent policy. Whatever the case, all franchisors will need to figure out one fact – whether the candidate is a suitable fit.

Related: How To Become A Franchisor?

Organizational Skills 

Sometimes, franchisors will look to introduce a collective activity (e.g. special promotion, marketing event, etc.) whereby all units under the franchise brand will have to implement it themselves in their own territory. Without possessing basic organizational abilities, the franchisee may have difficulty developing the project and following through on details. Or worse, a weak implementation could result in a negative impact on the franchise and brand instead. 

Decision-making 

Franchisees, as business owners, will have to make decisions on a regular basis. Sometimes, these decisions will have to be made under stress or ad-hoc situations. Regularly making bad calls may see the franchise business go to the dumps quickly. 

Financial Management 

The ability to manage finances will be a particular point of interest for franchisors because franchisees will be required to make periodic franchise payments based on sales records. If these records are in a mess, franchise payments could inevitably be affected too. 

Drive For Success 

One of the worst types of franchisees are those that are taking up the franchise just as a hobby, with minimal interest in the well-being of the business or brand. When this interest wears off, the franchisee will be looking to exit just as quickly as they entered the franchise agreement. 

Support From Those Who Matter 

Running a business is a life-changing decision, not to mention being stressful enough as it is. Without emotional support from those who matter, franchisors could be looking at a franchisee whose state of mind is not conducive for running a business optimally.